My mom and I were on the phone the other day, trying to talk to a credit card company. We dialed the number for account services, and immediately, we entered what I’ve come to know as “IVR Purgatory.”

Whenever we tried to answer a question to direct our call to “the appropriate person,” the Interactive Voice Response system picked up every sound in the background, and replied. “I’m sorry; I didn’t understand your response.” After a few minutes of this madness, and resorting to using the keypad, we finally got through to a live human (it sounded like one, anyway).

Customer service continues to be an issue with businesses replacing people with automation, study finds.(Photo11: Thinkstock)

This is an everyday experience for millions of people around the world, and it’s hard to find someone who hasn’t been frustrated with voice-response systems at one time or other. As recent research shows, we’re getting fed up and it’s affecting the way people feel about companies (and not in a good way). Some experts believe companies are damaging their most important relationship – the one they have with their customers.

This disconnect is also occurring with the use of chatbots, the software that fools you into thinking you’re chatting or texting with a real person when you’re actually talking to a computer. Many chatbots pop up automatically when you visit a website, often with real names to make you think you’re speaking with a live person (not all pop-up chat windows are staffed by bots, but many are).

They’re part of a growing number of strategies used by companies to automate certain functions to save money and streamline how services are delivered. Many retailers are even automating the in-store shopping process, using various technologies which allow shoppers to bypass humans altogether.

Chatbots aren’t exactly a new invention. Back in the 1960s, scientists at MIT created ELIZA, which used pre-set responses to respond to questions and emulated a psychotherapist. Users could type in their questions and the system would respond with something vaguely reminiscent of a what a real therapist might say.

Many people reported conversing with ELIZA as if “she” (named after the Eliza Dolittle character in "My Fair Lady") were a real person.

But all this automation is apparently creating a “huge disconnect” for companies. The study, conducted by Oracle NetSuite in partnership with Wakefield Research and The Retail Doctor, suggests that retailers are making a crucial mistake in replacing people with robots.

“These findings point to a clear and urgent need for better customer service,” said Bob Phibbs, CEO of The Retail Doctor (a retail consulting firm). “No retailer wants their customers to be confused or anxious, yet more than half of respondents have felt that way while shopping.”

Bright and shiny new technologies are exciting to cost-conscious retailers, who operate in a highly competitive environment in many cases. Believing that their customers will appreciate the efficiency of dealing with machines, many retail companies have dived headlong into the pool of innovation. And nearly three-fourths of the retailers surveyed said they believe their retail locations have become more inviting in the past five years.

The problem: customers aren’t feeling the same. About 45 percent of consumers who were asked the same question said they disagreed, and nearly one in five said shopping had become more stressful and less inviting than five years ago. And while about eight in 10 of executives said chatbots were meeting their customers’ needs, shoppers sharply disagreed. Many respondents noted that chatbots are “currently more damaging to the shopping experience than helpful.”

Another significant disconnect is occurring with retailers’ engagement with customers on social media. While nearly all retailers said they believe engaging with customers on social media is “important to building stronger relationships” with them, only about 12 percent of consumers agreed.

But the obvious answer to the problem – getting store personnel to interact more with customers – could also be a mistake if not handled correctly. While eight in 10 retailers said they’d like to try having their retail employees interact more with customers, less than half of customers agree (and more than a quarter said they’d be “annoyed” by more interaction).

“Customers will feel confident when they develop an emotional connection to the brand,” he said. “With nearly every respondent reporting that they value brick-and-mortar stores, now is the time to craft every in-store interaction to keep shoppers coming back.”